By Charles Wolfe
The Associated Press

FRANKFORT - Gov. Ernie Fletcher's proposed tax plan would do more than raise the excise tax on cigarettes. It would impose, for the first time in Kentucky, an excise tax on other tobacco products - cigars, snuff and chewing tobacco.

The administration projects the new tobacco taxes would raise $333 million over the biennium that begins July 1. That would be the single largest revenue source in Fletcher's plan to raise some taxes and cut others - mainly income taxes on individuals and corporations - in nearly perfect balance.

Fletcher made a campaign promise that any tax changes would be "revenue neutral." But his administration is banking that the cuts will stimulate economic growth, leading to revenue growth, within two years.

State Budget Director Brad Cowgill said the administration expects its plan to result in 7,000 new jobs and $43.2 million in new revenue by 2008.

Fletcher said Thursday he wanted to raise the cigarette tax, now 3 cents per pack, by 26 cents. That would be $2.60 per carton. Details released Friday include a higher tax - 39 cents per pack - on cigarettes made by manufacturers that did not join the tobacco industry's legal settlement with the states over costs of treating sick smokers.

Snuff and chewing tobacco would be taxed at 9.5 cents per package. Smoking tobacco and cigars would be taxed at 10 percent of wholesale price.

Kentucky is one of three states, including Virginia and Pennsylvania, that do not tax tobacco products other than cigarettes, according to the administration. Neither does the District of Columbia.

Fletcher also proposed doing away with excise taxes and a nickel-per-case production tax paid by distillers. In their place, he would raise the wholesale tax rate, now 9 percent for all beverages.

New rates would be 15.53 percent for liquor, 11.94 percent for beer and 12.86 cents for wine.

Consumers would pay an extra 34 cents on a 1.75-liter bottle of bourbon costing $20. Beer drinkers would pay an extra penny per can or bottle. The cost added to a $10 liter of wine would be 22 cents.